US clears China of yuan influence

US clears China of yuan influence

Created: 2009-10-17 1:09:04

THE United States government said on Thursday that China did not manipulate its currency against the US dollar and has made significant contribution to world economic recovery during the first half of this year.

"No major trading partner of the United States" met the standards identified by a US act of manipulating their rates of exchange against the greenback to gain unfair competitive advantage in international trade, the Treasury Department said in its Semi-Annual Report to Congress on International Economic and Exchange Rate Policies.

Based on a 1988 law, the Treasury is required to submit to Congress twice a year a report identifying whether its major trade partners manipulate their currencies to boost their exports to the US or make US products more expensive in overseas markets.

Since the end of the dollar peg in July 2005, the yuan has appreciated a cumulative 21.2 percent against the dollar and 15.7 percent on a real effective basis, based on the BIS (Bank for International Settlements) measure, said the report.

According to the BIS index, China's real effective exchange rate appreciated 13.3 percent between June 2008 and February 2009, it said.

The report also said China has contributed to the global economic recovery.

China's "timely and aggressive fiscal and monetary policy stimulus has resulted in a strong domestic economic recovery and a decline in its current account surplus, and as a result contributed significantly to the recovery in global demand," it said.

China's real gross domestic product rose by 7.1 percent on an annual basis in the first half of this year, as fixed-asset investment and consumption contributed 6.2 percentage points and 3.8 percentage points to growth, respectively, said the report.

Reflecting the decline in China's trade surplus, net exports in the first half of this year subtracted 2.9 percentage points from growth, the report added.

This month, the International Monetary Fund forecast that China's real GDP would gain 8.5 percent this year, up from its April forecast of 6.5-percent growth. The IMF predicted China's GDP will grow 9 percent next year.

(Xinhua)


US clears China of yuan influence

The United States government said on Thursday that China did not manipulate its currency against the US dollar and has made significant contribution to world economic recovery during the first half of this year.

"No major trading partner of the United States" met the standards identified by a US act of manipulating their rates of exchange against the greenback to gain unfair competitive advantage in international trade, the Treasury Department said in its Semi-Annual Report to Congress on International Economic and Exchange Rate Policies.

Based on a 1988 law, the Treasury is required to submit to Congress twice a year a report identifying whether its major trade partners manipulate their currencies to boost their exports to the US or make US products more expensive in overseas markets.

Since the end of the dollar peg in July 2005, the yuan has appreciated a cumulative 21.2 percent against the dollar and 15.7 percent on a real effective basis, based on the BIS (Bank for International Settlements) measure, said the report.

According to the BIS index, China's real effective exchange rate appreciated 13.3 percent between June 2008 and February 2009, it said.

The report also said China has contributed to the global economic recovery.

China's "timely and aggressive fiscal and monetary policy stimulus has resulted in a strong domestic economic recovery and a decline in its current account surplus, and as a result contributed significantly to the recovery in global demand," it said.

China's real gross domestic product rose by 7.1 percent on an annual basis in the first half of this year, as fixed-asset investment and consumption contributed 6.2 percentage points and 3.8 percentage points to growth, respectively, said the report.

Reflecting the decline in China's trade surplus, net exports in the first half of this year subtracted 2.9 percentage points from growth, the report added.

This month, the International Monetary Fund forecast that China's real GDP would gain 8.5 percent this year, up from its April forecast of 6.5-percent growth. The IMF predicted China's GDP will grow 9 percent next year.




Xinhua


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